SAIL is expecting its net sales realisation to improve during April-June quarter of this fiscal. The State-owned steel major had posted an over nine per cent decline in net sales realisation and a three per cent decline in volume sales on a year-on-year basis in the January-March 2013 quarter.

Talking to media persons here on Saturday, the company’s Chairman C. S. Verma said the global steel market had bottomed out and prices are only on the rise from this point.

Asked if the realisations would improve in the current quarter, he said: “It has to go up.”

SAIL reported a 72 per cent decline in profit in the last quarter due to lower realisations and higher costs. The costs included one-time payouts, staff expenses, actuarial revisions and non-revision of prices with the Indian Railways, one of the largest consumers of its steel products. SAIL’s poor performance also lowered its rating by advisory services such as Equity Bulls.

Despite this, the company is set to add capacity of 2.5 million tonne at its existing Rourkela facility in Odisha “in the next 10 days”. Another 2.5 mt capacity will be added at Burnpur in West Bengal by December. SAIL currently manufactures nearly 14 mt of steel.

Verma negated apprehensions that the increased capacity in the middle of an economic slowdown would add to the company’s problems.

Meanwhile, SAIL is going ahead with an environmental impact assessment study for the proposed iron nugget unit at Durgapur in West Bengal, which will likely be completed by the end of this year. The project is in collaboration with Japanese steel-maker, Kobe Steel.

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